The nuts and bolts
Many businesses fail because they have no control of their sales process.
A good sales process:
- Ensures your team is ‘engineered for success’
- This should be present from the moment you employ them to every deal they close
- It’s critical to place the prospect and customer at the centre of the process.
A sales process is the ‘sales way’ of the organisation. Every sales way is unique to the particular company, whether it’s a start-up or a large corporate. The sales process is a blueprint for how the company can best serve its customers, relative to its product or service offering. Ultimately, the key reason for developing a sales process is to ensure you drive maximum revenue.
In my experience many companies, small and large, do not have a well-defined sales process in place. My advice is to begin developing a sales process as a key priority within your company. Keep it simple, do a few things exceptionally well rather than many things in an ordinary way. If executed well, the results will follow far better than you can imagine.
A well thought out sales process enables:
- Improvement in forecasting accuracy
- Repeatability of successes
- Sales managers converting from administrators to effective coaches
- Sales teams shifting from sellers to value creators
- Higher customer satisfaction due to improved professionalism
- More frequent and higher conversion rates
- Every activity of the sales force can be efficiently carried out by new employees
- Management can adapt and improve the way the sales team engages with customers and ensure that the customers are getting the best benefit
- Driving customer satisfaction is the key element on which all improvement is based.
Create a sales process methodology
Always start with the customer. Define all the elements required within your sales organisation relative to a customer’s needs. What customer needs can your company potentially deliver a solution for? Work backwards from that point of departure and you will be able to create all the required sales processes accordingly.
The best way to tackle the creation of a sales process methodology is to define the headings relative to your customers’ needs and then plot them backwards from the very end, such as after sales service and right back to how you recruit a new sales person. There is no blueprint or ‘how to’ template here as each company will (should) have its own customer centric sales way.
Creating a value-driven sales process
There are definitive elements which must always be included in a sales process and the starting point is to ensure your company creates and develops a value-driven, diagnostic-based system for selling.
Your sales engagement process needs to include how you discover, diagnose, design and deliver solutions for your prospects and ultimately customers. Essentially, it’s looking at all the key elements within the sales organisation and then creating a process for them that can be repeated again and again with improvement when necessary. That’s why the sales process methodology you develop remains a living document that must be tweaked and enhanced as required.
Beware of the Internet in your sales process
It’s important to note that the digital revolution has impacted the sales process dramatically. Research from Google and advisory company CEB, titled The Digital Evolution in B2B Marketing, provides new insight into buyer behaviour.
According to the study, customers reported being nearly 60% through the sales process before engaging a sales rep, regardless of price point. Up to 57% of the sales process just disappears. What are buyers doing if they’re not talking to sales?
They’re surfing corporate websites to identify and qualify vendors instead of waiting for the sales team to qualify them. They are using social media to learn more about their needs, potential solutions and providers, and they’re reading, listening to, and watching free digital content that is available to them at the click of a mouse. No longer is the sales force the sole source of information.
It’s becoming increasingly important for sales to transition from being a ‘product pusher’ to an ’insight provider‘ adding value to the buyers’ business.
What does this mean for the sales organisation? No matter whether your sales team numbers one, three or 300, if those people are simply walking, talking product brochures, trying to tell a prospect why your product is better than another, they are going to lose.
Customers, or prospects in this case, know what your product does and what your competitors’ products do, and they may even know that better than the sales person does. So then what is the role of the sales person?
A look at sales metrics
Sales metrics are used to understand the effectiveness of marketing and sales activities and the efficiency of the sales process. They are all the things that a sales organisation needs to do to greatly increase the likelihood of achieving target.
The starting point
- Start with territory alignment, territory management and sales force sizing
- What is the size of your total available market?
- How many people do you need to maximise reach into this market?
- What is the achievable revenue?
- What is the average deal size?
- How many appointments do you need so that you can submit proposals and increase the possibility of closing those deals?
An appointment can be a follow-up to check that what you have sold to someone has been delivered. It could be an appointment that forms part of the way you engage to find a solution and close the deal.
- How many calls do you need to make every week to secure those appointments?
- How many deals do you need to close to achieve target?
- How big should your pipeline of prospects be? This is the number of companies you’re engaging with who may potentially buy your product.
- The sales metrics must be predetermined and inspected and reviewed regularly, daily or at the very least, weekly.
Sales metrics are always related to the target
- If the sales person has a target of R100 000 per month and the average size deal is R20 000, they will have to close five deals a month to achieve target.
- Working backwards from that, and depending on the industry, let’s say 20 appointments per month are required in order to close five deals.
- This means your sales person is closing one out of four. If you prospect and qualify correctly, your team may be able close one out of three. Having the figures to hand can help you shorten the sales cycle and raise performance to deliver a phenomenal increase in revenue.
- Metrics also display how much progress has been made towards the goal of closing the deal.
Developing sales metrics ensures a systematic process you can repeat over time and begin to perfect.
The best way to track metrics is to have a CRM system in place, but the software will mean nothing if you do not have a process in place for how that information is entered into the system.
Diaries need to be populated correctly. If you’re reading this article, take a look at the diaries of your sales force, see how much white space there is, and ask what that sales person is doing during their ‘white space’ time. You will be shocked at the low levels of activity!
Diaries should be colourful and vibrant: Blue for appointments, red for admin, green for follow-ups, whatever colours you choose. And if you see a number of appointments being made for 3.00pm, do your company a favour and give one of those prospects a call to find out how the meeting went. That may well be your second surprise!
Being a trusted advisor; mediocrity to excellence
Develop a culture within your sales organisation by transforming your sales reps from sellers to advisors. By advisor I mean a person who can accompany the prospect through a process of discovery and diagnosis of their needs, talking very little along the way and rather asking intelligent questions to ascertain what that person’s real need is and to expose them to fresh, new ideas — and ultimately to highlight the cost of not changing as well as the real benefits of changing.
It’s not about selling; it’s about ascertaining true need and finding a solution.
This consultative approach to selling starts with the people you employ and the moment they join the organisation. It’s about a culture and that starts with the owner of the business.
How are you as a leader? Is trust fundamental to the way you operate? If you as the leader of a business do not elicit trust-based character traits it’s going to be a barrier to your own selling success and that of your team. That’s because the only differentiator you have in today’s commoditised economy is not your product or your service.
You can differentiate only through adding value to that prospect’s life by being a trusted advisor. Do not sell for yourself; go out there and engage for the betterment of your customer. And it all begins with your sales process.
Developing sales discipline through inspection and metrics
If you do not have a manual with the processes, methodologies and structures in place you are unable to monitor, review and coach your sales team and discipline will be lacking or non-existent. It’s as simple as that.
To quote the late Chet Holmes, ”What you do not inspect, they do not respect.“ If you want your team to respect your policies or processes, make sure they know what you expect, all of this outlined in your process manual. You will be truly amazed at the results that will follow.
Key Tips To Retain Customer And Improve Sales In Ecommerce Sites
If the ideas you are selling are fresh, innovative or even intuitive, you might gain customers, but retaining them actually determines the exact ROIs you can gain from your venture.
Ecommerce in simpler terms is the activity of buying and selling of goods and services over the web. With the increasing reach and accessibility of internet day by day, online mode of business transactions is gaining prominence. For any business, retaining customers is more advantageous than acquiring new ones.
The root of customer retention for any business digs deep. And here are few stats to show the depth of its importance:
- Almost around 41% of online revenues generated are from retained customers that too just by 8% of the retention rate.
- If an ecommerce site can increase their customer retention by mere 5% rate their sales can increase by 25% to even 125%.
- Unsatisfactory customer service takes a toll on a business. About 71% of unsatisfied customers end their relation with the vendor.
As the importance of customer retention is being cleared, the next question to pop up is the method of retaining customers. You have to keep note of the important aspects that lead to retaining customers effectively. Here are a few handpicked proven ways to retain your customers and thus improve the sales.
1. Gesture of appreciation
A simple gesture of appreciation or offer or discount can do wonders in enhancing sales. Unexpected surprises or gifts are something which is appreciated by everyone and can cement your relation with your customers.
For this you can add extra discounts, offer vouchers or can send the customer some gifts with a handwritten ‘thank you’ note couple of days after buying. This unexpected gesture of appreciation will divert customers’ attention towards your site.
2. Email marketing
Your customers already provide you with data about their choices and preferences. However continuous email campaign is a subtle but effective way of expanding your customer database. Expand the items that are being added in the emails.
Try to innovate the offers and discounts, add newer items to increase your customer’s preferences and keep tracking them. Track which sequence of emails is gaining the highest hits.
3. Gold membership
Probably the most used, yet efficient way of customer retention is VIP privileges and Gold membership etc. A policy including reward points and hierarchical VIP status enabling your customers to various privileges offers etc. act as significant ways of improving sales. The alluring offers and VIP memberships will entice your customers to shop more.
4. Customer Services
A seemingly consistent and personalised customer service is what controls most of the brands nowadays. Most of the market researches show that it’s the customers who modulate and decide the fates of the brand. So be where your customers are for cementing a professional relation with them.
5. Showing diligence
Just occasional email campaigning and gifts and vouchers aren’t enough for successful customer retention. In the era of high-end competition, if you are not careful about the needs, preferences, requirements and most importantly, the complaints of your customers, no matter how much offers or VIP privileges are provided, customer retention is impossible.
Being proactive to the needs of customers, engaging them continuously as well as collecting and reacting to their feedbacks are the three major steps for any customer retention scheme.
6. Create value for Customers
If you are buying online , will you choose to buy from a website that sells low quality products at a cheap price? The answer is certainly no because everybody desires for quality in terms of shopping. Also, cost alone isn’t valued by customers, there have to be multiple components of value addition to optimise the overall shopping experience for your customers. As an e-commerce company, you need to master the elements of making a successful e-commerce website and later work upon your plan.
7. Limited period offers
Almost all ecommerce sites nowadays follow the policy of giving limited period offers and big bash discounts etc. A large-scale promotion before the said offer period, and some lucrative offers along with VIP privileges can help.
Improvising the existing privileges too can lure the existing customers into more shopping and hence enhance online retail sales.
8. Transparency in sales
Honesty is the key to success in any field of life. An ecommerce business site is no different. It takes painful long period of time for building up a company’s reputation. The only cue card that vouches for the reputation is transparency in sales and company’s policy.
The more transparent you are the better feed you get in return. So, whatever be the service you provide, keeping hidden policies and hidden charges is a strict no-no.
9. Promise and supply gap
It’s good to aspire for more, for bigger contracts, more sales but aspiration shouldn’t blindfold your capabilities. Continuous offerings to customers, more discounts and bigger promise for retaining them shouldn’t go beyond your limits and you end up giving lower outputs in reality.
This, in long run, hinders your company’s reputation to a considerable extent as well. So, promise only according to your limits and not beyond.
10. Building up a customer community
Humans are social beings by nature. The brand you are selling can actually act as a platform for different customers. Add a community chat room in your site where your customers or the Gold members can login by their credentials and discuss the pros and cons, offer fresh ideas, match and compare their services etc.
This allows for a rigorous service assessment, customer needs, and fresh idea generation for increasing sales and knowing the pulse of the shopper.
11. Enhancing social shares
This is an add-on feature of the preceded one. Your clients are your potential buyers some of whom are even potential giant-scale buyers. To churn the need of buying in them, incentivise your social platforms. You can do that by putting brand ambassadors’ photographs and ask for a competition amongst the clients.
Alluring offers and gifts for the winners will also make it an enticing professional deal. This can act in both retention and outreaching to newer clients. Also, these gifts and competitions can enhance the word-of-mouth publicity as well.
To wrap it up
Retaining customer is as important as reaching new ones. In fact in long term, customer retention plays a pivotal role. So a proper, polite and courteous customer service, a prompt feedback and complaint resolving team, transparent policies and quality performance on-time are few attributes that can retain customers and take your business sky high.
The Pros And Cons Of Selling To Your Friends And Family
Don’t ignore the first stages of engagement, just because they don’t result in immediate purchases.
“When starting out in business, the first people that you rely on to test out a product and pricing are those closest to you or as we teach the kids in the FutureProof programmes, low hanging fruit. But what do you need to keep in mind when using this as your first customer set? The feedback loop from selling to these people will be skewed and if you know this, you can build a business that will survive outside of “easy targets”, says Lisa Illingworth.
1. Confidence Boosting
Starting a business is ridiculously hard. To take the plunge is often the scariest thing that we attempt and with the failure rates being heavily stacked against business survival, it should be the goal of every new entrepreneur to boost your confidence. And nothing boosts confidence like an eager customer.
Friends and family make great confidence boosters. It’s their mandated job to enthusiastically follow your business Facebook page and buy every product you have to sell, even if it is in early development phase.
2. Gentle Criticism
Intrinsically linked to the first pro, is the second pro that friends and family should deliver criticism in a gentle manner that will not break your fragile spirit. These people should be heavily invested in your personal growth and if this is true, they will be concerned about your infatuation with this business, and not breaking it.
And this may only be because they don’t want to field phone calls late at night after the idea tanks or pay your rent when the funds dry up.
3. Cash Flow
The life blood of any new business is the constant trickle of money coming into the business in the early days to keep yourself, the entrepreneur alive and fed. Don’t underestimate the necessity of keeping money flowing, even regular but small amounts. Friends and family are great sources of quick, regular purchases and they are more likely to choose your small business over a larger one because of the emotional investment in you.
1. Inflated Expectations
Please don’t be fooled by the outright enthusiasm that your family and friends have for your new product or service as the general sentiment carried by those that have no idea who you are. You will be sorely disappointed when you find out that all that hype was based on a personal connection and investment in you, the entrepreneur.
When people outside of your personal network see the value at the price you’re charging, you are then quite literally, on the money. Until then, keep your expectations in check.
2. False Feedback Loop
I think like most of us who could just not bare the deflated façade creep across a friend’s face if you gave them cold, hard feedback that the homemade mix of spices they have randomly thrown together and called ‘Chai Tea’ is not a tasty as she thinks it is. And thus, we buy a jar and stick it in the back of the pantry hoping it gets forgotten.
This type of feedback loop, whilst protects the relationship, does not protect the young business person from the harsh reality that their product is just not that good. You may be concerned about how a friend will take the news and the impact it will have going forward, a customer will not be that forgiving. The false feedback loop sets an entrepreneur up to fall even farther when the real feedback starts coming in.
3. Market Exhaustion
If the only customers you actually have are those purchasing based on their investment with you this market will quickly become exhausted. If you have not devised a strategy to tell others outside of your network about your business, you will not be developing a continuous stream of new customers through a customer journey.
In marketing, it is almost never that people buy on the first encounter with a business. There needs to be a ‘dating’ like process where customers get to know, like, trust and try before they make a purchase. If you have ignored growing these segments of your marketing and sales, you will eventually exhaust those in your network and be left with limited cash flow and little market awareness.
What then is the answer to this conundrum? By all means take the confidence boosters from those closest to you that will keep you afloat in the early stages of growth, but keep your expectations measured and seek out the harsh criticism from strangers to refine your offering so as to have real value at a palatable price point.
We teach the kids at Futureproof to find people to buy your service or product that are easy to get to without spending time or money but we don’t specify who they are rather to find the low hanging fruit in order to start but spend time marketing to a larger audience at the same time. Don’t ignore the first stages of engagement, just because they don’t result in immediate purchases.
The 7 Rules Of Pitching
If you want to build an investable business and land funding, you need to understand the landscape. Vusi Thembekwayo unpacks how smart businesses attract investors.
- Player: Vusi Thembekwayo
- Company: My Growth Fund
- Visit: mygrowthfund.co.za
In 2014, Zithande Mbala pitched his business idea, a smart toilet paper lubricating device, to the Dragons on SABC’s Dragon’s Den. It was a bizarre pitch, not least of all when Zithande valued the business to be worth northwards of $100 million in a few months’ time. He was offering a 10% stake in the company for an investment of R1 million.
The Dragons did not respond to Zithande’s pitch well. It made for entertaining television, but no one thought they were watching a great investment walk out the door when the Dragons collectively said, ‘I’m out’.
And then in 2018, one of those Dragons, Vusi Thembekwayo, saw a smart toilet paper lubricating device at OR Tambo International Airport. He gave Zithande a call, only to discover that the business was off the ground — and had some large contracts to boot.
“How did we miss it? All of us are entrepreneurs and we completely missed it,” says Vusi. “I’ve rewatched that clip a hundred times, trying to figure out why we all thought it was a terrible idea with no hope of making it in the real world.”
There are lessons to be learnt in Zithande’s pitch for both funders and entrepreneurs looking for funding. “We pre-judged him, which we shouldn’t have done. He had an accent that he said came from spending time in New York, but we knew he hadn’t. It’s a strong lesson for us not to pre-judge, but it’s also a lesson for entrepreneurs. We all put on personas — we wear suits to meetings when we wear jeans at the office — it’s a part of doing business, but you need to be careful not to come across as inauthentic. If you’re trying to be something that you’re not for a funder, it might backfire.
Rather be who you are and have confidence in yourself. Authentic, transparent entrepreneurs will be respected, even if you’re coming from a completely different space or background to the investors you’re approaching.”
The next lesson speaks to the nature of both entrepreneurship and finding funding: Always persevere. “If you believe it, do it,” says Vusi. “It’s a cliché, but clichés exist because they’re true. Don’t listen to negativity, don’t stop, and don’t in the moment let the bumps in the road shape your reality.
“There will always be hiccups. We make mistakes. We get rejected. If you let these derail you, you’ll never succeed. Most companies don’t get funding the first time round. Most entrepreneurs don’t succeed with their first ventures. You need to learn to push on, no matter what life throws at you.”
But perseverance is just a starting point. If you want to build an investable business and land funding, you need to understand the landscape. These are Vusi’s seven lessons in attracting a funder’s attention.
Related: Pitching in the Dragons’ Den
1. Put each ‘no’ to good use
According to Vusi, it’s almost immediately apparent whether entrepreneurs have pitched their business to investors before, and it works in their favour.
“They answer the questions we’re thinking in their presentations, before we need to ask them,” he says. “No meeting with a funder is a waste. You can either let the rejections wear you down, or you can learn something and perfect your deck.”
2. Record all meetings
“No funder will say anything in a meeting that you can’t hear, so ask if you can record the meeting,” advises Vusi. “When you play back the recording, you’re now a third-party listening in. You can hear yourself — wow, why did I stutter there? Why do I sound so nervous? Why didn’t I say this… There is so much you can learn and improve on just by re-living a meeting.”
In addition, when you’re recording a meeting, you don’t need to take a lot of notes and you can be completely present in the discussion.
3. Use the 10/20/30 Rule of PowerPoint
A few years ago, Guy Kawasaki evangelised the 10/20/30 Rule of PowerPoint. In a nutshell, a pitch should have ten slides, last no more than 20 minutes and contain no font smaller than 30 points.
“We’ve seen this combined with design thinking, and it makes for a compelling pitch,” says Vusi. “When I first saw it, it seemed so basic and even obvious, and yet so few entrepreneurs use this format. If you do though, you steer away from an executive summary and SWOT analysis and instead focus on the problem, how you’re solving it and where the commercial opportunity lies.
“What is the problem you’re solving? It’s such a basic question to ask, and yet so few businesses start there when they’re pitching. Instead, there’s a tendency towards, ‘This is me and my team, and our amazing clients, and the 15 000 products we offer… and the person you’re pitching to is thinking, ‘hold on, what’s the problem? Help me understand the problem. Because if I get the problem, you have my interest.”
4. The goal of the first meeting is to secure a second meeting
You need to grab an investor’s attention in the first meeting to secure a second meeting, and the way to achieve that is by piquing their interest with a problem that you can profitably solve. “I’ve learnt that a pitch has to grab me within the first seven minutes, or my attention starts moving to my emails, to-do list or other urgent matters,” admits Vusi.
“I’m present at the beginning of the meeting — that’s where you need to unpack the really important stuff. The rest can follow later. If you grab an investor’s attention, you will get the opportunity to discuss your team, products and clients. All of those things are important. But you don’t want them upfront, and then by the time you’re reaching the most crucial part of your presentation you’ve already lost everyone’s interest.”
As an entrepreneur, Vusi learnt this lesson the hard way. “We went on fundraising rounds ourselves, and I realised that I had eight slides of fluff upfront, because there were so many things I felt I just ‘had’ to let them know. The reality is that I needed to present our hook — follow-on questions and meetings will cover everything you need to unpack. But if you don’t have that hook, you’ll never reach that point.”
5. Practice, practice, practice
“Iteration is important. Deliver your pitch as many times as possible. Practice on business associates, friends, family — anyone who will listen. But make sure some of them are strangers, or at least people who will give you the unvarnished truth. You don’t want to feel good and get a pat on your shoulder — you want to perfect your pitch.
“Ideally, what you need is someone who will ask questions from an outsider’s perspective. See what they latch onto, or what they don’t understand. How long does it take to explain what you do, or the problem you’re solving? We all make assumptions and we all understand our businesses and industries, but don’t assume the person you’re speaking to has the same perspective or knowledge.”
6. Don’t treat every potential investor as the same
There are a number of key things to understand about the funding landscape. First, venture capital and private equity firms raise money from partners. They have shareholders that they are answerable to, and to whom they need to show returns. They need to grow the capital they invest. Therefore, if there isn’t a growth opportunity, there isn’t an investment opportunity.
“You need to show how the investment will help you grow the business,” says Vusi. “This is a key element — if I put in x, I will be able to get y out. Yes, there’s a risk that it won’t work, but you need to have a growth story; you need to be able to demonstrate how you plan to get there.”
In addition, each fund has a mandate. Approaching an FMCG and Agri investment fund for a tech venture is pointless. Similarly, approaching an eco-fund with a plastic bottled-water concept will not work. Understand the fund, the individual investors and how your business suits their mandate.
6. Know your numbers
If you’re a subject matter expert and not a finance person, speak to someone who is. “Tap into your network and find someone in that space. They will understand the money and ask you the questions that relate to that part of the pitch and business. This will give you an idea of what investors will ask so that you can come prepared to answer their questions. Too many entrepreneurs walk into an investment meeting and don’t have all the numbers they need at their fingertips. This is a red flag for investors — how will you grow their investment and your business if you don’t have a handle on the numbers?”
Pitch to a taxi driver
This is a simple lesson that Vusi himself figured out while taking a ride in a taxi. “We were waiting for passengers and started chatting, first about how the local music industry is changing and then moving on to my business,” says Vusi.
“It was an incredible experience. Here was the stranger, asking me questions about my business that I knew the answers to, but had never considered including in my pitch.
“Taxi drivers have a short attention span because of what they do. They also run high-volume, low-margin businesses and work under immense pressure. They understand exactly how to think about their businesses in terms of how much return their vehicles are giving them. Think about it. A taxi driver will charge a passenger R2,50 for a ride, but owes R250 000 on his taxi, so he understands all about capital returns and depreciation cycles. He’s an excellent resource — and he’s free. You need to get to the point and see if your pitch makes sense.”
The 10/20/30 Rule of PowerPoint
Guy Kawasaki’s 10/20/30 Rule of PowerPoint is made up of ten slides.
- Title: Provide company name, your name and title, address, email and cell number
- Problem/Opportunity: Describe the pain that you’re alleviating or the pleasure you’re providing
- Value Proposition: Explain the value of the pain you alleviate or pleasure you provide
- Underlying Magic: Describe the technology, secret sauce or magic behind your product. The less text and the more diagrams, schematics and flowcharts the better. If you have a prototype or demo, now is the time to transition to it. If a picture is worth 1 000 words, a prototype is worth 10 000 slides.
- Business Model: Explain who has your money temporarily in their pocket and how you’re going to get it into yours.
- Go-to-Market Plan: Explain how you are going to reach your customer without breaking the bank.
- Competitive Analysis: Provide a complete view of the competitive landscape. Too much is better than too little.
- Management Team: Describe the key players of your management team, board of directors and board of advisors, as well as your major investors. It’s okay if you have a less than perfect team. If your team was perfect, you wouldn’t need to be pitching.
- Financial Projections and Key Metrics: Provide a three-year forecast containing not only rands but also key metrics, such as number of customers and conversion rates. Do a bottom-up forecast, not top-down.
- Current Status, Accomplishments to Date, Timeline and Use of Funds: Explain the current status of your product, what the near future looks like and how you’ll use the money you’re trying to raise.
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